USD/JPY should remain within the current consolidative trading, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “Instead of “edging above the strong 108.40 level”, USD traded sideways between 107.92 and 108.27 before ending the day little changed at 108.17. The underlying tone still appears to be slightly positive and we continue to see chance for USD to test 108.40. That said, a move beyond the next resistance at 108.60 is not expected. On the downside, a break of 107.90 would indicate that the current mild upward pressure has eased”.
Next 1-3 weeks: “Despite the relative strong advance in USD, we continue to hold the same view as highlighted earlier yesterday (23 Jul, spot at 107.90) wherein USD is trading sideways within a 107.40/108.40 range. While the underlying tone has improved, only a NY closing above 108.60 would indicate that USD is ready to challenge the early July peak near 109.00. The prospect for such a scenario is not high for now but it would continue to improve as long as 107.70 is intact”.
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